California to State Farm: Go Ahead and Increase Insurance Rates by 17%

California has approved the emergency rate hike State Farm requested for homeowners' insurance policies in the wake of this year's devastating Los Angeles wildfires. The company will be temporarily allowed to increase rates in the state by 17%, a move that comes on the heels of State Farm having been granted a 20% rate increase just last year, the New York Times reports. State Farm didn't quite get the 22% emergency increase it requested this year, but homeowners and consumer watchdog groups are calling foul nonetheless, with one watchdog group saying the rate hike "adds insult to injury" for those whose homes were destroyed, some of whom accuse State Farm of delaying their claims or attempting to give them less than they're due.

The interim rates will take effect June 1 and will last until a full evidentiary hearing, which will be held no earlier than October, the San Francisco Chronicle reports. At that hearing, the insurance company must justify the rate increase; if a judge isn't satisfied, the company will be forced to reimburse customers. This is the first public hearing in a rate hike request case in almost a decade in California, one of just a dozen states that require approval of insurance rate hikes before they hit consumers. (More California stories.)